Whenever I started to hear "I should have buy more" or "I want to buy more now" or "What good stock to buy?", I know exciting time, yet again, has come to the stock market. Everyone yearn for it. It has been relatively uneventful period for the past one year for the stock market. Now is certainly a refreshing period. How long will it last this time? Nobody will know but why not we welcome it while it lasts. I am not suggesting we must pour everything we have into the stock market but rather we must invest sensibly.
Quite often during this period of time, people will start to ask "What stock can I invest?" Sometime I rather not to answer but trying to be polite, I just said "put some money that doesn't cause an arm or a leg if anything happened". Because I knew based on their demeanour, they already have decided to buy with or without my opinion. They just need someone there to reinforce whatever they intend to do soon or maybe already had did it. 3 most possible scenarios of their current situations will be when asked further:-
1) He or she has not invested anything prior to this or invested in some stocks.My question will be - what make you think you are really investing and not trading this time around and why now when the market is hot and not say 6 months ago when the market is cool?My humble answer is you are probably attracted by the easy money from the hot market. You will get out as soon as you get in. Therefore, you have to be careful dabble with stock market.
2) He or she has invested in some stock but the price not yet move and wanted to top up the same stock.My question will be - is the company still fundamentally good as the first time you bought it? If yes, my humble answer is no harm to top up.
3) He or she has invested in some stock that price has moved up and wanted to top up the same stock instead of dispose it.My question will be - have you satisfied with the profit and has achieved what you have targeted during your first buy?If yes, my humble answer is take the profit and enjoy the fruit of your investment. Then take your time to hunt for next stock investment. Be disciplined and steadfast to your goal is the key to sustainable stock investment mindset. It doesn't matter if the stock price keeps climbing after you have disposed it. You have make your profit, and let someone makes theirs.
If no, my humble answer is no harm top up units of the same stock. The quantum is a matter of your personal risk tolerance. As for my recent case, I have topped-up 25% units when the price has increased 40%. The reason for doing this is pure mathematics to plan my top up arrangement rather than based on emotion. Bear in mind, this arrangement might not work for you if your current stock holding is less than 10,000 units. By stating 40% figure doesn't mean I have set my exit price. Certainly not. My exit price is a function of the company financial performance in future, it means as long as the company grows, my exit price grows in tandem, it means my exit price is dynamic, it means it is a long term investment.
Whatever it is, the bottom line always is we must make money from stock investment. Doesn't matter how much you have made, as long as you are happy after selling, and that matters. Doesn't matter your next friend makes more profit than you, as long as you know you have made the right stock choice and it had given you that profit, and that matters.
By the way, many had asked why I did not talk about JAKS. Well, i think recent events had already attracted so much attention. Nothing more need to talk about, really. You can make your own judgement. To buy or to sell or to stay, only give us the same outcome - that is we will still glue to the computer screen for some time now.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Kukuman
The great Unclez is back! Thank you for your jaks recommendation. Even though price come up late but better than never. Stay healthy sir. Salute !
2017-04-06 11:01